1960 (3) TMI 2

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....ing belonging to its partners where the latter also resided. This building was requisitioned by the Government in September, 1943, for the duration of the war. The respondent had thereupon to shift its business to another place where it was restarted sometime later. The respondent claimed compensation for the requisition on various accounts and was paid various sums. One of the claims was made in these words : "On account of the compulsory vacation of the premises disturbance and loss of business on the basis of two years at Rs. 2,29,450 per annum............Rs. 4,58,900," On this head the Government paid Rs. 57,435. The question is whether this sum of Rs. 57,435 was liable to income-tax and excess profits tax. It would be liable if it wa....

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....y exist, it may not exist : see Hill v. Fearis. The Department does not contend that the existence of the goodwill had to be proved. What it says is that since it does not follow that every business has a goodwill, a loss to such goodwill has at least to be claimed and in the absence of such a claim it would follow that there was no such goodwill and nothing could therefore have been paid in respect of it. This seems to us to be an argument of substance and we did not understand learned counsel for the respondent to contend to the contrary. What he said was that there was a claim for a loss to the goodwill. We turn now to the words in which the claim was made which we have earlier set out. There is no mention of any loss to goodwill there....

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....s to the letter which accompanied and explained the respondent's claim. Referring to the claim under consideration, the letter stated : "If we take a fresh construction of our factory on temporary basis, this means time and therefore one of the biggest items in the 'Details of Claim' has got to be included." Now the biggest item of claim is the item under consideration. It was further stated in that letter : "As a result of the evacuation and in the absence of any premises we have been forced to warehouse our machines which are now idle and unproductive...............unless we are reinstated immediately in some temporary place and given electric connection and given the other facilities, we estimate that our business will suffer at le....

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....l stage of business." It is said that this shows that the respondent was claiming for loss of goodwill. That seems to us quite untenable a contention. No goodwill is referred to. All that is said here is that competitors would go ahead while the respondent's business remained stopped. Now that has nothing to do with loss of goodwill. It is only concerned with the stoppage of the respondent's business irrespective of its removal from one premises to another. Further, this statement was not in connection with any claim actually made. It could only, if at all, be taken as referring to the claim for loss of profits. We, therefore, do not think that this portion of the respondent's letter helps it. It seems to us for the reasons aforesaid th....